Statement on the 2nd EU-BiH SAA Subcommittee on Internal Market and Competition Including Consumer & Health Protection

Mostar, 19 September 2017

Representatives from the European Commission (Commission) and from Bosnia and Herzegovina (BiH) met in Mostar on 19 September 2017 for the second Subcommittee under the Stabilisation and Association Agreement (SAA) on Internal Market and Competition, including Consumer and Health Protection. This meeting was a forum to discuss the implementation of the SAA, as well as approximation of the country legislation to the EU legislation (‘acquis’) in these fields. The meeting was co-chaired for BiH by Mr Hamdo Tinjak, from the Ministry of Foreign Trade and Economic Relations and by Mr Georg Ziegler from the Directorate General for Neighbourhood and Enlargement Negotiations (DG NEAR) of the Commission.

The Commission highlighted the cross-cutting importance of the topics discussed at that meeting, which are also relevant for the reform of the public administration and the implementation of the Reform Agenda/ Economic Reform Programme of BiH. They are also key with regard to the establishment of a regional economic area in the Western Balkans, which was endorsed at the Trieste Summit on 12 July 2017.

In the area of banking, insurance and financial services, the Commission welcomed the adoption of the new banking legislation in both entities approximating further to the EU acquis. BiH is still at an early stage regarding the right of establishment and freedom to provide services, an area which is also of relevance for regional integration. In particular, work on the approximation to the EU “services directive” needs to be accelerated. On Company Law, the Commission noted positively some further steps in the simplification of business registration procedures, particularly in the Republika Srpska, though overall, the legal framework in BiH remains too fragmented.

The legal and institutional framework for public procurement in BiH shows some level of preparation. Further alignment with the EU acquis is needed, particularly in the area of concessions. BiH has some level of preparedness in competition policy. Here, the priority should be to improve the functioning and decision making process of the competition and State aid authorities, in particular by giving up the “ethnic vetoes”. Except for merger cases, there should not be deadlines governing the work of the Competition Council,  Both institutions need to build a convincing enforcement record. The Commission expressed regret with regard to the underfinancing of the State Aid Council due to Republika Srpska’s continuous refusal to contribute to its budget in line with the State Aid Law. In the area of intellectual property rights, where BiH is moderately prepared, the priority should be given to the effective enforcement of the existing rules.

Finally, on public health policy, the Commission concluded that BiH is still at an early stage of preparedness. Further efforts are needed, in particular to improve equal access to health care and to develop anti-tobacco policies and adopt the necessary legislation. BiH was also encouraged to develop an effective consumer protection framework.

Overall, the Commission highlighted the importance of coordinated gradual implementation of EU legislation at the various levels of governance in the country. The Commission offered assistance in the approximation process, not least through the TAIEX instrument.

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